Patricia is purchasing a farmhouse in rural Vermont for $180,000 as her primary residence. The property has a private well and a septic system. Her lender requires a conventional mortgage. Which Vermont-specific requirement is most likely to affect the financing contingency in Patricia's purchase contract?
Correct Answer
D) A Vermont Wastewater and Potable Water Supply Permit, because the property relies on private well and septic systems
Under Vermont's Wastewater System and Potable Water Supply Rules (Environmental Protection Rules, Chapter 1), a state permit is required for new or replacement wastewater systems and potable water supplies. In Vermont's rural real estate market, properties with private wells and septic systems commonly require verification that these systems have valid permits. Lenders and buyers routinely require this as a contingency in purchase contracts. Patricia's lender will likely require confirmation that the well and septic system have valid state permits before approving financing.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An adjustable-rate mortgage (ARM) has an interest rate that changes periodically based on market conditions, typically after an initial fixed-rate period. The rate adjustment is tied to a financial index plus a margin.
Closing costs are the fees and expenses paid by the buyer and seller at the closing of a real estate transaction, beyond the purchase price. They typically range from 2-5% of the purchase price.
A conventional loan is a mortgage that is not insured or guaranteed by a government agency such as the FHA, VA, or USDA. It is originated and funded by private lenders and may be conforming or non-conforming.
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